Sukanya Samriddhi Yojna- SSY – Eligibility , Interest rate , Returns in 2021

Sukanya Samriddhi Yojana in 2021

Last Updated on 2 weeks ago by Raj Kumar

Sukanya Samriddhi Yojna 2021

Investing for a girl child is most probably the first thought that happens in every Indian parent’s mind. Parents want a safe and secure investment that they can use for their daughter’s study, marriage, etc. when their daughter turns 18-21. Although there are many options available in the market Sukanya Samriddhi Yojna stands out as one of the best options for Indian parents.

In this article

we will try to understand all the details about Sukanya Samriddhi Yojna in 2021.

Sukanya Samriddhi Yojna
Sukanya Samriddhi Yojna

What is Sukanya Samriddhi Yojna?

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Sukanya Samriddhi Yojna is a Govt of India sponsored scheme where an Account can be opened in the name of a girl child till she attains the age of 10 years. 

This account gives higher interest rates at 7.6% as of February 2021 compared to conventional savings instruments. The investment in this account also qualifies for tax benefits under 80C for the parent of the girl child.

In March 2021 , The GOI attempted to reduce SSY interest rates from 7.6% to 6.9% but they had to revert back the notification after receiving huge criticism!

Consider reading – 13 safe investments with high returns in India

What are the rules for Sukanya Samriddhi Yojna?

As per NSI India Below are the rules for Sukanya Samriddhi Yojna

  • The account can be opened in the name of a girl child till she attains the age of 10 years.
  • Only one account can be opened in the name of a girl child.
  • The account can be opened in Post office and branches of authorized banks.
  • Birth certificate of girl child in whose name the account is opened must be submitted.
  • The account can be opened with a minimum of Rs. 250/- and thereafter any amount in multiples of Rs. 100/- can be deposited. A minimum of Rs. 250/- must be deposited in a Financial year.
  • Maximum Rs. 1,50,000/- can be deposited in a financial year.
  • Interest @ as may be notified by the government from time to time will be calculated on a yearly compounded basis and credited to the account.
  • One withdrawal shall be allowed on attaining the age of 18 years of the account holder to meet education expenses up to 50 % of the balance at the credit of the preceding financial year.
  • The account can be transferred anywhere in India from one post office/bank to another.
  • The account shall mature on completion of 21 years from the date of opening of the account or on the marriage of Account holder whichever is earlier.

Consider reading Top 10 Best investment options in India in 2020

State-wise investments in Sukanya Samriddhi Yojna

As per NSI India as of 31.12.2018 below is the figure of investments in Sukanya Samriddhi Yojna account state wise in India

Date source – NSI India

Sukanya Samriddhi Yojna FAQs

How to open Sukanya Samriddhi Yojna account?

Sukanya Samriddhi Yojna can be opened in any post office or most of the public/private sector banks.

Can I open Sukanya Samriddhi Yojna online?

No. You can not open Sukanya Samriddhi Yojna account online as of July 2020. You need to either visit a bank or post office to open the Sukanya Samriddhi Yojna account.

What are the documents required to open Sukanya Samriddhi Yojna account?

You will need Sukanya Samriddhi Yojna Account Opening Form, Birth Certificate of girl child (mandatory), Identity proof (as per RBI KYC guidelines), and Residence proof (as per RBI KYC guidelines) to open Sukanya Samriddhi Yojna account.

What is the latest interest rate for Sukanya Samriddhi Yojana in 2021?

As of July 2020 the rate of interest for Sukanya Samriddhi Yojana is 7.6%.

Is premature withdrawal allowed in Sukanya Samriddhi Yojana?

Premature withdrawal is allowed in Sukanya Samriddhi Yojana on in 2 cases:-

1.  In the event of death of the account holder, the account shall be closed immediately on production of death certificate issued by the competent authority, and the balance at the credit of the account shall be paid along with interest till the month preceding the month of premature closure of the account , to the guardian of the account holder.

2.Where the Central Government is satisfied that operation or continuation of the account is causing undue hardship to the account holder, it may, by order, for reasons to be recorded in writing, allow pre-mature closure of the account only in cases of extreme compassionate grounds such as medical support in life threatening diseases, death, etc.

Is it good to invest in Sukanya Samriddhi Yojana?

If you are looking for a secure investment which gives highest interest rates along with tax benefits then you can invest in Sukanya Samriddhi Yojana.

What are the disadvantages of Sukanya Samriddhi Yojana?

The biggest disadvantage of Sukanya Samriddhi Yojana is the lock-in period. You can not withdraw the money before the girl child turns 18.

What is the maximum amount that can be invested in Sukanya Samriddhi Yojana?

You can invest maximum 150000 in a financial year in Sukanya Samriddhi Yojana account.

Does Sukanya Samriddhi Yojana qualify for tax savings as part of 80C?

Yes investments in Sukanya Samriddhi Yojana account qualify for tax benefits under section 80C.

When does Sukanya Samriddhi Yojana mature?

The Sukanya Samriddhi Yojana account shall mature on completion of 21 years from the date of opening of the account or on the marriage of Account holder whichever is earlier.

One withdrawal shall be allowed on attaining the age of 18 years of the account holder to meet education expenses up to 50 % of the balance at the credit of the preceding financial year.

Is investment in Sukanya Samriddhi Yojana better than mutual funds?

Sukanya Samriddhi Yojana gives 7.6% interest rates as of July 2020. The historic returns of an equity mutual funds over 20 years is more than 10% CAGR. So if you are not willing to take any risk of market fluctuation and want a safe steady returns than you Sukanya Samriddhi Yojana is a better investment than mutual funds.

But if you are willing to take a bit of risk then investment in equity mutual fund may give you far better returns than Sukanya Samriddhi Yojana.

What is the age limit of investing in Sukanya Samriddhi Yojana?

10 years. The girl should be less than 10 years old to be eligible to qualify for Sukanya Samriddhi Yojana account.

Is Sukanya samriddhi better than PPF?

Sukanya samriddhi account fetches slightly higher interest than PPF in July 2020. Although both of them have a longer lock-in period, PPF matures in 15 years which is slightly earlier than Sukanya samriddhi account which is locked for at-least 18 years before you can make a partial withdrawal.

Is Sukanya samriddhi maturity tax free?

Yes. Maturity amount of Sukanya samriddhi account is exempted from tax.

Can both parents claim the tax benefits of Sukanya Samriddhi Yojana?

No. Only one parent can claim tax benefits of investment in Sukanya Samriddhi Yojana.

How many Sukanya samriddhi Yojana account can be opened?

Only one. You can open only one Sukanya samriddhi Yojana account for a girl child.

How much should I invest in Sukanya samriddhi Yojana?

Although Sukanya samriddhi Yojana is an excellent choice for safe investments you shouldn’t all of your savings for your girl child in Sukanya samriddhi Yojana; Equity mutual funds have given far better returns over a long term as compared to Sukanya samriddhi Yojana. You should look to diversify your investments and look for instrument like equity mutual funds, Stocks, Hybrid fund which can give you excellent returns compared to Sukanya samriddhi Yojana over long term..

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